G-20 Backs $1Trillion Boost For Struggling Nations

G-20 Backs $1Trillion Boost For Struggling Nations

by -

obama-g20-presser.jpgPresident Obama emerged from the global summit of G20 leaders with an agreement to provide funding for $1 trillion in additional loans and credits for struggling emerging markets and low-income countries through the International Monetary Fund and other institutions.

The summit also started the process of clamping down on tax havens for the wealthy and loosely regulated investment funds for the rich.

Mr. Obama said the G-20 meeting approved critical, bold steps. He said there is no guarantee they will all work, but he stressed the healing process has begun.

“I think we applied the right medicine,” he said. “I think the patient is stabilized. There are still wounds that have to heal. There are still emergencies that could arise. But I think you have some pretty good care being applied.”

The G-20 nations today also reaffirmed previous commitments to increase aid and help countries achieve the Millennium Development Goals, promising at least $300 billion in aid over the next two years for the ambitious anti-poverty targets with a 2015 deadline.

The G-20 leaders, whose countries generate about 80 percent of global output, agreed to make available immediately an additional $250 billion for the IMF to lend. This would later be incorporated into a more flexible New Arrangements to Borrow (NAB), expanded by up to $500 billion in total.

Meeting in London, the leaders also called for a doubling of the IMF’s lending capacity to its low-income members, and for a boost to global liquidity through a $250 billion issue of the Special Drawing Rights (SDR) reserve asset. To enhance the voice of emerging markets and developing countries in the IMF, the G-20 urged accelerated review of IMF quotas, which reflect country representation at the IMF.

The G-20 comprises 19 countries: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom, and the United States, plus the European Union, represented by the rotating Council presidency and the European Central Bank. The Managing Director of the International Monetary Fund and the President of the World Bank, plus the chairs of the International Monetary and Financial Committee and Development Committee of the IMF and World Bank, also participate.
(Gathered from VOA and IMF material)